BYLAW NO. 2124 — Hotel Room Tax Requisition Bylaw No. 2124

Staff Report to Council

DATE

Tuesday, February 21, 2023

DEPARTMENT

Administration

SUBJECT

Five Year Renewal of Municipal and Regional District Tax (Hotel Tax)

BACKGROUND

The Municipal and Regional District Tax (MRDT), commonly referred to as the Hotel Tax, was introduced in 1987, by the Provincial Government, to provide funding for local tourism marketing, programs, and projects. The tax is intended to help grow BC revenues, visitation, and jobs, and amplify BC’s tourism marketing efforts in an increasingly competitive marketplace. The MRDT allows for a tax of up-to three percent tax to be applied to sales of short-term accommodation provided in participating areas of British Columbia on behalf of municipalities, regional districts, and eligible entities. The MRDT is jointly administered by Ministry of Finance, Ministry of Tourism, Arts and Culture, and Destination BC.

In 2006, the City of Langford adopted a Bylaw to impose a two percent MRDT at short-term accommodation providers in Langford. This was updated as required in 2013, and again in 2018.

COMMENTARY

Staff held two engagement sessions with the four Langford hotels to review the proposed five-year tourism strategy and discuss the process for renewal of the MRDT. Following the second session, the four Langford hotel owner representatives approved and strongly supported the renewal. Each hotel representative signed the official documentation required by Ministry of Finance, Ministry of Tourism, Arts and Culture, and Destination BC to renew the MRDT. The CRD has also provided a letter of support which is a procedural requirement of the renewal.

Staff are recommending an additional five-year renewal at a two percent tax rate.

FINANCIAL IMPLICATIONS

Costs of administrating the program and associated costs including marketing and visitor services are covered by MRDT revenues.

LEGAL IMPLICATIONS

Once the Bylaw is adopted by Council it must then be approved by the Province. The current provincial approval is in place until November of this year.

OPTIONS

Option 1
THAT Council give first three readings to “Hotel Room Tax Requisition Bylaw No. 2124”;

OR Option 2
THAT Council not proceed with Bylaw No. 2124

SUBMITTED BY

Donna Petrie, Senior Manager of Business Development

Concurrence: Yari Nielsen, Director of Parks, Recreation and Facilities
Concurrence: Matthew Baldwin, MCIP, RPP, Director of Planning and Subdivision
Concurrence: Katelyn Balzer, P.Eng, Director of Engineering and Public Works
Concurrence: Michael Dillabaugh, CPA, CA, Director of Finance
Concurrence: Marie Watmough, Deputy Director of Corporate Services
Concurrence: Braden Hutchins, Director of Corporate Services
Concurrence: Darren Kiedyk, Chief Administrative Officer

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BYLAW NO. 2124

A BYLAW TO REQUEST IMPOSITION OF AN ADDITIONAL ACCOMMODATION TAX UNDER THE PROVISIONS OF THE PROVINCIAL SALES TAX ACT

The Council of the City of Langford, in open meeting assembled, hereby enacts as follows:

WHEREAS City Council wishes to use additional revenue to finance marketing of the City of Langford as a tourist destination; and

WHEREAS pursuant to Section 240 of the Provincial Sales Tax Act, S.B.C. 2012, c. 35 the City may request, by bylaw, that the Lieutenant Governor-in-Council may make regulations providing for an additional tax levy, not exceeding 2%, on the sales of accommodation within the City;

NOW THEREFORE, the Council of the City of Langford enacts as follows:

1. The Lieutenant Governor-in-Council is requested to make a regulation pursuant to Section 240 of the Provincial Sales Tax Act, declaring that effective November 1st, 2023, Section 123(1) of the Act applies in respect of accommodation purchased within the City.

2. The tax to be imposed under the provisions of the regulation is requested to be 2.0% of the purchase price of the accommodation.

3. The funds paid to the City under the provisions of the regulation shall be applied to marketing of the City of Langford as a tourist destination.

4. “Hotel Room Tax Requisition Bylaw No. 1778” is repealed.

5. This Bylaw may be cited for all purposes as “Hotel Room Tax Requisition Bylaw No. 2124".

READ A FIRST TIME this day of 2023.

READ A SECOND TIME this day 2023.

READ A THIRD TIME this day of 2023.

ADOPTED this day of 2023.

PRESIDING COUNCIL MEMBER

CORPORATE OFFICER

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Appendix: Accommodation Sector in Support of Municipal and Regional District Tax Form

Municipal and Regional District Tax Program Requirements - Summer 2018
APPENDIX 1.4
Appendix 1.4 Accommodation Sector in Support of Municipal and Regional District Tax Form

Legal Name of Applicant: Langford
Rate of Tax (2% or 3%):

Applicants, please check the following, if applicable:
Does the designated recipient plan on using general MRDT revenues (meaning revenues beyond Online Accommodation Platform revenues) for affordable housing initiatives and are these activities included as part of the Five-Year Business Plan and One-Year Tactical Plan (including Appendix 1.8)? 0i;^Qex! here

The Municipal and Regional District Tax (MRDT) is being proposed or Is up for renewal in your municipality/region. The MRDT is intended to assist municipalities, regional districts and eligible entities in funding local tourism marketing programs and projects, as outlined in the applicant's Five-Year Strategic Business Plan. Affordable housing initiatives are also included as a permissible use of revenues. Accommodation providers may request a copy of the Five Year Strategic Business Plan from the applicant. The MRDT will apply to purchases of accommodation that are taxable under the Provincial Sales Tax >4ct within the designated accommodation area.

As an owner/manager offering accommodation, your input is critical. The minimum support required from the accommodation sector for the tax to be imposed is at least 51% of the number of establishments that would collect the tax within the municipality/region representing at least 51% of the total number of rooms.

BY SIGNING THIS FORM, YOU HAVE INDICATED THAT YOU SUPPORT IMPLEMENTATION OF THE MUNICIPAL AND REGIONAL DISTRICT TAX IN YOUR MUNICIPALITY/REGION AND THAT YOU ARE AUTHORIZED TO ACT ON BEHALF OF YOUR ORGANIZATION. [ATTACH ADDITIONAL SHEETS AS REQUIRED]

Accommodation Provider Details (as extracted)

(Signature / Owner/Manager)